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Blue Cross Blue Shield of Michigan and Munson Healthcare Reach Value-Based Reimbursement Agreement

November 12, 2013
by John DeGaspari
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Agreement includes funding for infrastructure improvements needed to better coordinate care between the hospitals and physicians

Munson Healthcare, Traverse City, Mich., a non-profit network of hospitals and clinicsNorthern Michigan, has launched a value-based hospital reimbursement with Blue Cross Blue Shield of Michigan (BCBSM).

The reimbursement arrangement is being launched at Munson Medical Center in Traverse City, Kalkaska Memorial Health Center in Kalkaska, and Paul Oliver Memorial Hospital in Frankfort. The arrangement covers a three-year period and supports closer collaboration between the hospitals and their physician partners to improve the health of the populations they serve, according to a prepared statement. To accomplish this, BCBSM will provide the health system with funding for infrastructure improvements needed to better coordinate care between the hospitals and physicians.

Since last year all three hospitals have been working with their provider partners in the community to develop and implement an infrastructure plan that includes an all-patient registry system. The system would enable caregivers in the hospital and in doctor’s offices to have easier access to patients’ records so that information can be combined from multiple sources to promote coordination of care, improve care quality, and help ensure the right care is given at the right time in the right setting.

Their agreement provides a fair base-rate increase in reimbursement from BCBSM to the hospital. In addition Blue Cross will reward the hospitals with a share of the savings achieved when hospitals and physicians coordinate the delivery of efficient and effective care, eliminate reuse and over use of care, and prevent re-hospitalizations.

Each hospital and its physicians have established milestones to ensure infrastructure work continues along with funding through 2015. 






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